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CMO’s Notebook: Digital Transformation Is A Mindset, Not A Project

Does your organization really need that new technology? An increasing number of CMOs are asking themselves that very question, which was also the title of Jen Horton’s presentation at the recent SiriusDecisions Summit 2016, in Nashville.

Horton is senior research director, demand creation strategies, at SiriusDecisions, a B2B research and advisory firm. “I work across all B2B verticals and collaborate with my peers across all of our CMO, sales, and product practices,” she explained.

Horton spoke to CMO.com at the event about why chasing the next shiny tech thing is not the solution to building your mar-tech stack. (Click here to read a companion article, “CMO’s Notebook: Marketers Get ‘Sirius’ About Intelligent Growth.”)

CMO.com: What are the top common issues and pitfalls that you see B2B companies across all verticals experiencing as they go through the digital transformation journey?
Horton: That’s tough--there are so many. But first I would say that when we see digital transformation being driven from within the middle ranks of the organization, often we also see little buy-in from the C-suite, including a cultural commitment to support the change management effort to achieve the transformation objectives. I am seeing about half of the digital transformation being initiated from within the middle-management ranks and the other half being initiated by the C-suite.

The second pitfall I see is senior leadership wanting digital transformation, but they don’t have a qualified change agent and team to lead, road map, and project manage what is needed. So even though the vision and desire is at the C-suite level, they may not be properly resourced. When we see this happen, we craft digital transformation team structure and roles, and position profiles and job descriptions for the types of talent with the right capabilities we believe they need to achieve the transformation’s objectives.

Third, I don’t see enough companies doing a true baseline to audit where they are today in terms of performance, efficiency, etc., and having a handle on the real current state, setting milestones, articulating what they really want to achieve. When you are doing a digital transformation, you don’t want to boil the ocean. It is important to be able to look back and see what metrics and ROI the initial transformation changes have delivered versus the baseline. In many cases, clients don’t know how to baseline or don’t have the tools to capture measurements.

By the way, the digital transformation journey is never done once you are committed, so it is important to constantly measure progress. It is not a project. It is a mindset, culture shift, and a new way to do business.

CMO.com: We’ve heard from many speakers at the SiriusDecisions Summit about how important it is to make sure company culture and alignment is in place prior to embarking on a digital transformation. Why is this so important to achieve success?  
Horton:
I’m passionate about helping in this area. I’ll start with functional alignment. Think about the typical quarterly business review meeting discussion, where the CMO is sharing the performance metrics of the marketing function: “We generated 100 leads for sales, etc.” Then the chief sales officer reports on his team’s metrics about the sales they generated, but that they only got five leads from marketing and generated all of the other leads themselves. Immediately, the rest of the C-suite starts to question whose numbers are right, why we don’t define the metrics the same way, what the source of information is, etc.

This type of situation speaks directly about marketing and sales being misaligned and what they should be doing together. It is clear that they’ve never defined what a qualified lead, a qualified buyer, is. They share responsibility in creating a qualified pipeline of prospects and converting that to revenue growth. This confuses the rest of the C-suite. The CFO doesn’t know who to give more budget to generate more qualified leads.

For digital transformation to work, it is even more important for marketing and sales to come to the table with one shared mission, with everyone tied to a revenue growth objective. Then you can reverse-engineer the digital transformation process together, have additional conversations on the marketing and sales tech stack needs, and figure out [the point person] at each stage of the process. Start out with the business goals, roles and responsibilities, operational processes, and capabilities needed in each function to support the transformation. When you’ve done this work, then you can start to evaluate different tech platforms and design your tech stack. This is just one alignment example.

From a cultural perspective, it is important to have a healthy comfort level with failure, to fail fast, and to truly support this so that failure is OK. You will not get everything right the first time. You need to be a culture where testing, data-driven optimization, and learning are the norm. If you have this, then people can take big bets, big risks. Incremental optimization is interesting. But having people with big creative ideas that could really lift performance and aren’t afraid to fail is what you need. You want to encourage your people to do these things. You also need a shared collaborative culture all focused on business growth.

CMO.com: Your presentation (PDF) had great insights on the challenges posed by the rapidly evolving mar-tech landscape. What are the biggest takeaways for CMOs?
Horton:
It is an exciting time to be a marketer. There are tens of thousands of tech products and tools out there. This is awesome. But it also speaks to a bad habit that a lot of us have, which is to run to the shiny, new object. Marketers are deluged with calls and emails to “try my new tech stuff.” Oftentimes marketers buy that next new tech thing without having thought through what is required, what the use cases are, and how this will integrate and operate with what I currently have in my mar-tech stack. So I often tell clients to properly document their current processes, understand what problems they are solving, and to understand the capabilities are required and what they will need for the new tech addition.   

CMO.com: What is your call to action to B2B CMOs to lead the digital transformation in their organizations?
Horton:
I want CMOs to be obsessed with their customers and customer experiences, and enable the C-suite and organization to be obsessed with customers. Also, be the vision and example for the digital transformation, business model transformation, and culture change that you want to see happen. Empower and support strategic people who are good influencers, doers, curious, can navigate the political landscape, are fearless, and are accountable to lead in the right direction. But also make sure that you have people on the team who know how to get there. Own it and be accountable for the digital transformation journey.

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